Question

Explain the procedure relating to the acceptance of deposits.

Answer 1

Introduction: -The following are the secretarial duties in connection with the acceptance of deposits:

• Bank Account: -
  The secretary has to make necessary arrangements with the bankers (including the opening of the bank account) to collect deposits.

• Appointment of Bankers: -
  The Company may appoint a broker to solicit deposits from the public. The secretary has to ensure the proper appointment of brokers for securing deposits.

• Verification of Application Forms: -
  The application forms that have received by the bankers along with deposits amount, and those received directly by the company through the brokers, must be verified properly. 

• Preparation of Depositors’ List: -
  The secretary has to prepare a list of eligible depositors. The secretary may prepare a separate list of small depositors. The small depositors are those depositors whose deposit amount is up to Rs. 20,000/-

• The holding of Board Meetings: -
  The secretary may call a Board meeting to pass a resolution for acceptance of deposits.The Board may also authorize the secretary to issue a deposit receipt.

• Issue of Deposit Receipt: -
  The secretary should issue a receipt containing the prescribed details. The deposits receipt must be signed by an officer of the company.

• Entries in Register of Deposits: -Thesecretary must make necessary entries in the Register Deposits. Proper details must be entered in the register of deposits in respect to each depositor such as:
•  Name and address of the depositors   2.  Date and amount of deposits  
  3. Period of deposits           

• Date of maturity         
  5.  The date on which interest to be paid

• Filing or Return of Deposits: - 
  The secretary needs to prepare and file with the ROC, a return of deposits for the period ending 31^st March of the financial year. The return of deposit must be filed on or before 30^th June every year.

• Payment of Brokerage: -
  The secretary has to arrange for the payment of brokerage to the brokers. The secretary should follow the rules for the payment of brokerage. At present, the maximum brokerage (as per Rule 3 (1) (d) Companies Acceptance of Deposits) Rules 1975.